Wednesday, February 03, 2010

World Bank working with Chinese on bringing manufacturing to Africa

World Bank head Robert Zoellick says they are going to do more partnering with China to develop a manufacturing base in Africa. In the past the bank has been critical of China, especially in the recent roads for copper deal with the Congo. They have accused China of taking materials from the continent, or filling their African manufacturing plants with Chinese workers instead of locals.

Robert Zoellick says the World Bank is now working with the Chinese to bring their toy and shoe manufacturing to Africa. The Bank hopes that more manufacturing on the African continent will help it follow in the Asian model and history of development.

The legacy of colonial rule means many sub-Saharan African countries -- South Africa excluded -- have economies structured round the export of raw materials such as oil, gold and cocoa, and have to import basic manufactured goods at higher prices.

Developing a domestic factory sector would go a long way towards cutting these costs, as well as creating jobs and accelerating industrialisation.

Chinese officials often talk of the potential for Chinese investment to bring about an African industrial revolution. Zoellick's desire to see World Bank expertise and cash tied up with Chinese business and manufacturing knowhow supports that view.

It also marks a departure from World Bank criticism of some of the massive minerals-for-infrastructure deals that have typified much Chinese investment in the continent.

"In the case of China, we may sometimes look for opportunities to co-invest; sometimes we may try to help and work with the local government to build infrastructure -- maybe it's the electricity to power the plants, maybe it's the roads," Zoellick told journalists via teleconference from Addis Ababa.

Other examples included advising host countries on streamlining customs procedures -- a vital step in establishing manufacturing-for-export zones, he said.